Consumer electronics retailer Circuit City Stores posted a worse-than-expected quarterly loss and withdrew its earnings forecast Wednesday, citing a drop in television sales and an uncertain economic environment.
Circuit City's results suffered from similar weaknesses reported Tuesday by larger rival Best Buy Co. Inc., which had cast new doubts on U.S. consumer spending trends and sent both their shares lower. Circuit City shares edged up nearly 1 percent in afternoon trading after dropping 3 percent on Tuesday. Analysts said the results were not surprising, and investors might have already taken into account the retailer's woes based on Best Buy's report.
"Circuit City is clearly struggling with the challenging consumer electronics environment and is, characteristically, executing less well than Best Buy," Bernstein analyst Colin McGranahan said in a client note. During the quarter, weakness in projection, traditional and plasma televisions and in MP3 digital music players more than offset strength in categories such as large LCD TVs, notebook personal computers and video gaming products.